Correlation Between Naturhouse Health and SANTANDER
Can any of the company-specific risk be diversified away by investing in both Naturhouse Health and SANTANDER at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Naturhouse Health and SANTANDER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Naturhouse Health SA and SANTANDER UK 8, you can compare the effects of market volatilities on Naturhouse Health and SANTANDER and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Naturhouse Health with a short position of SANTANDER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Naturhouse Health and SANTANDER.
Diversification Opportunities for Naturhouse Health and SANTANDER
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Naturhouse and SANTANDER is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Naturhouse Health SA and SANTANDER UK 8 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANTANDER UK 8 and Naturhouse Health is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Naturhouse Health SA are associated (or correlated) with SANTANDER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANTANDER UK 8 has no effect on the direction of Naturhouse Health i.e., Naturhouse Health and SANTANDER go up and down completely randomly.
Pair Corralation between Naturhouse Health and SANTANDER
Assuming the 90 days trading horizon Naturhouse Health is expected to generate 1.37 times less return on investment than SANTANDER. In addition to that, Naturhouse Health is 3.88 times more volatile than SANTANDER UK 8. It trades about 0.01 of its total potential returns per unit of risk. SANTANDER UK 8 is currently generating about 0.07 per unit of volatility. If you would invest 10,998 in SANTANDER UK 8 on September 12, 2024 and sell it today you would earn a total of 2,552 from holding SANTANDER UK 8 or generate 23.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.68% |
| Values | Daily Returns |
Naturhouse Health SA vs. SANTANDER UK 8
Performance |
| Timeline |
| Naturhouse Health |
| SANTANDER UK 8 |
Naturhouse Health and SANTANDER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Naturhouse Health and SANTANDER
The main advantage of trading using opposite Naturhouse Health and SANTANDER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Naturhouse Health position performs unexpectedly, SANTANDER can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in SANTANDER will offset losses from the drop in SANTANDER's long position.| Naturhouse Health vs. Hong Kong Land | Naturhouse Health vs. Neometals | Naturhouse Health vs. Coor Service Management | Naturhouse Health vs. Fidelity Sustainable USD |
| SANTANDER vs. Vulcan Materials Co | SANTANDER vs. Ryanair Holdings plc | SANTANDER vs. Morgan Advanced Materials | SANTANDER vs. Amedeo Air Four |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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